Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/86399 
Year of Publication: 
2004
Series/Report no.: 
Tinbergen Institute Discussion Paper No. 04-031/1
Publisher: 
Tinbergen Institute, Amsterdam and Rotterdam
Abstract: 
I study a one-way flow connections model in which players are heterogeneous with respect to values and the costs of establishing a link. I first show that values and costs asymmetries are crucial in determining the level of connectedness of a network. Interestingly, unconnected equilibria are asymmetric and central players may emerge. Second, I show that non-singleton components have a wheel architecture as far as the costs of linking are not partner specific. Otherwise also the flower architecture constitutes an equilibrium. I interpret these results as saying that asymmetric connections across players are a peculiar feature of homogeneous environments; by contrast, in heterogeneous settings players hold asymmetric connections, which are accompanied by the emergence of central players.
Subjects: 
Networks
heterogeneity
JEL: 
D85
C72
Document Type: 
Working Paper

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